Two major development sites with capacity for over 1,700 homes are coming to market at Reading’s Minster Quarter.
Reading Borough Council has signed off plans to sell the former civic offices for a residential-led scheme. The council vacated the site in 2014 and previously pursued development with Kier Property, but this fell apart in 2018.
Combined with the adjacent Thames Valley police site and Magistrates Court, the site has allocation for 1,300 homes and two student campuses.
Proposals are expected to include a mix of low-rise and tall buildings, conferencing facilities, flexible events space, a new open local market, a bridge and a new town centre university campus. There is also expected to be further education uses with a growing number of student schemes linked to the university.
However, development is still in the early stages. Reading is currently tendering for advisers ahead of bringing the opportunity to market. The council will be seeking to sell the site by way of a development agreement and will seek further finance to complete demolition with a bid to the Brownfield Release Land Fund. It hopes to secure a partner by the end of 2022, with a planning consent achieved by the end of 2023.
Broad Street Mall
Separately, Moorgarth and South African REIT Texton are seeking buyers for the adjacent Broad Street Mall development opportunity (pictured), with an informal guide price of £55m for the freehold to the five-acre site.
Half of the value covers the newly refurbished 398,000 sq ft repurposed commercial asset. It has a gross income of £5.2m, with a WAULT of 4.9 years to break and 7.9 years to expiry.
This includes 75,215 sq ft of office space at Fountain House and Quadrant House, with an average rent of £17 per sq ft and a yield of 8%.
The retail is priced with a yield of 8% and includes 68,323 sq ft of internal mall space and 105,501 sq ft on the first floor. There is also 71,980 sq ft of leisure, and a 77,000 sq ft basement which is being marketed with potential for conversion to urban logistics or data storage. Broad Street Mall boasts a boutique cinema, indoor bowling and crazy golf and restaurants.
The remaining value is attributed to the consented land. Moorgarth secured planning consent for three residential towers comprising 422 homes, with two top on top of the mall, and a 101-bedroom hotel last year and has appointed Knight Frank to secure a buyer. Premier Inn has previously committed to operate the hotel.
BTR opportunity
Agents are marketing the site as an opportunity for build-to-rent, with residential rents to contribute the bulk of income, but the scheme has flexibility in the consent for a for-sale product too. There is also an option to convert the offices to residential via permitted development rights. The vendor is accepting offers for the property as a whole or in parts.
The wider site previously held the 1970s former Reading Borough Council civic offices, alongside The Hexagon Theatre, Broad Street Mall Shopping Centre, Thames Valley Police offices and Reading Magistrates Courts.
The council published an outline development framework for Minster Quarter in December 2018. The site was subsequently highlighted as a major opportunity area within the borough in the 2019 local plan.
It is located in Reading city centre close to transport links. Reading is set to benefit from the opening of Crossrail next year, which has spurred a £900m upgrade to the station and boosted developer interest in the city. Major residential-led regenerations in the pipeline include Lincoln MGT’s £750m Station Hill and a handful of other sites, including further housing from the council.
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